Calls for federal government funding to target businesses most affected by virus crisis

Mark Delaney, chief investment officer at Australian Super. Picture: Stuart McEvoy

AustralianSuper chief investment officer Mark Delaney wants Canberra to open its wallet and directly fund businesses affected by the virus to minimise the economic impact of the crisis.

In an interview, Delaney said “we have to try to keep business whole”.

He is working from the assumption the health crisis could last two quarters but the economic impact much longer if businesses are forced to shut down or lay-off staff.

His radical plan centres on direct funding of companies arguing we need money from outside the system rather than recycling funds from inside.

Delaney manages around $185bn in funds and is Australia’s biggest fund manager and he also started his career in Treasury more than 36 years ago so he is well aware that his plans would be an anathema to many in Canberra.

He said he was expecting a push in coming weeks from companies trying to raise equity capital to meet the shortfall in funds.

Lenders he said will also be targeted to help ease the pain on debt costs.

Delaney’s plan would be for the federal government to target those most affected by the crisis like the airlines and small business.

He declined to detail how it would operate but figures there are plenty in Canberra to work through those issues.

The idea being the likes of Qantas and Virgin would get direct lines of credit as long as this was spent on staff and suppliers.

Likewise, money could be given to the likes of Mark Steinert at Stockland allowing him to subsidise rents in his living centres (shopping malls) to current small business tenants.

The way Delaney sees it, the market has front-run the virus’s health impact and could front-run the recovery so long as there was a clear path forward and confidence remained in the system.